WASHINGTON - Federal Reserve policymakers have slightly increased their estimate of what the Fed's benchmark interest rate will be at the end of 2015 compared with their estimate three months ago.
The Fed has kept its benchmark rate at a record-low level near zero since 2008 to try to boost economic growth. Most economists expect the first rate increase to happen by the middle of next year. A Fed statement indicated little change in the timing of that first increase.
The median short-term interest rate supported by Fed policymakers at the end of 2015 is now 1.38 per cent, up from 1.13 per cent at its June meeting.
The Fed expects slower growth this year and next than in its last set of projections issued in June.
Fed policymakers expect the economy to grow just 2 per cent to 2.2 per cent this year, down from their June forecast of 2.1 per cent to 2.3 per cent. That reduction likely reflects the sharp contraction in the first quarter of this year: 2.1 per cent at an annual rate. The economy has rebounded solidly since then.
Policymakers forecast growth of 2.6 per cent to 3 per cent in 2015, down from an earlier forecast of 3 per cent to 3.2 per cent.
The central bank updates its economic projections four times a year. The forecasts serve as guides for its interest rate decisions.
The interest rate figures are based on the stated preferences of each member of the Fed's policymaking committee.
Fed chair Janet Yellen has cautioned reading too much into the interest rate figures.